Increasingly, it seems, some companies are so hungry for growth by acquisition that they're willing to pay for help in their fishing expeditions.

Last week came the announcements by two publicly traded companies in Northeast Ohio that they now have executives working full time to track down merger and acquisition opportunities.

Fairlawn-based A. Schulman Inc. last Monday, Jan. 6, announced it had hired James Irwin, formerly with Cliffs Natural Resources Inc., as senior director of corporate business development. It's a newly created position in which Mr. Irwin will be responsible for the plastic resins supplier's acquisitions and divestitures across the globe.

Joseph Gingo, A. Schulman's chairman, president and CEO, called M&A deals a “critical” piece of the company's growth strategy, especially in a less-than-robust economy.

A day later, accounting and business services conglomerate CBiz Inc. announced that David Sibits, president of CBiz Financial Services up until Dec. 31, is refocusing his efforts on external initiatives including mergers and acquisitions as part of the leadership transition.

More companies appear to want external help, too, in chasing down deals. Local buy-side advisers, or those professionals who make their living representing would-be buyers, say business has picked up dramatically in recent months.

The volume of inquiries and engagements in the fourth quarter of 2013 was the busiest it has been in several years, Mr. Hanson said, and he expects that pace to continue throughout 2014. One impetus, he said, is that many companies' sales still aren't what they were before the recession, and gross domestic product growth doesn't carry the promise of filling that gap.

“They (companies) are tired of fighting the battle of slow organic growth,” he said.

While there isn't a common industry or common size of the companies that have sought buy-side representation in the last year from MelCap Partners LLC in Medina, there is a common motivator — the competition they face, said Al Melchiorre, president of the investment banking firm.

“There's not as many quality opportunities in the market as there are buyers,” he said. “Therefore, it becomes more competitive and you need to make more of a concerted effort ... (to) make sure that if you're a buyer, you're in the forefront.”

MelCap, which does a bigger business representing sellers, has been doing “a few” more buy-side searches, according to Mr. Melchiorre.

Singular focus

When CBiz's Mr. Sibits answered a reporter's phone call last week, he was speaking from what he termed a “great place to hunt.” Twice a year, the 100 largest certified public accounting firms — save the industry's Big Four — meet, and it's prime time for expanding relationships and identifying potential acquisition prospects, Mr. Sibits said.

M&A work was something Mr. Sibits did a lot as president of the financial services subsidiary of CBiz. But now that he has passed the torch and assumed his new role as senior vice president of strategic development, it's going to be almost his sole focus, he said.

“It's a very important part of our strategy for growth,” Mr. Sibits said. “Our industry and other industries are in consolidating mode, where you have an aging population, and (there's) the demand for specialization and greater depth. We believe it's a very attractive time for us to be in the marketplace on a very proactive basis to get great companies to ... be part of our company.

“To have somebody who is focused on it versus just depending on somebody bringing deals to you, I think keeps you out in front of the curve,” he added.

League Park Advisors, a Cleveland investment banking firm, since its founding in 2010 has offered outsourced corporate development work, and during that time roughly 20% of its client base has retained it to find deals for them and market their interest to the deal community, according to managing director Brian Powers.

This year, though, Mr. Powers said acquisition-minded clients will drive that percentage to a third or more, thanks to “a very large increase over the last few months” in demand for such services. As a result, Mr. Powers said, League Park is interviewing to fill a couple corporate development positions, which, if filled, would double that staff.

“These are companies that are interested in doing large transactions, both in terms of the deal size they're looking to do and the number of transactions they're looking to complete,” he said.

“Companies have cash to spend on acquisitions ... and they are not fully satisfied by the traditional deal flow,” Mr. Powers said. “They want to start to develop their own proprietary deal flow. I don't see any of the factors that led to this slowing down in the near future.”

Going out on dates

For CBiz, the goal is two-pronged: It wants to become a Top 10 firm, by number of CPAs, in five years in the 15 markets in which it operates, including Northeast Ohio, and it has targeted five regions where the company doesn't have a presence, but wants one.

Texas is one. The upper Northwest is another.

To that end, in his new role, Mr. Sibits will spend a lot of time on the road, “dating.”

“Selling is like dating,” he said. “You need to build a relationship. It's really a matter of getting to spend one-on-one time with people, primarily in informal situations, going to dinner, going to lunch, taking people outside of their office where you get a feel for who and what they are.”

Cleveland-based Compass Self Storage LLC is another company that has hired someone in-house to do the dating. Last February, it announced the hiring of director of acquisitions Steve Hryszko, who had worked as an investment broker for the company since its founding in 2007.

“It was a realization of the fact that ... if we were going to grow, we needed somebody to focus on the M&A activity to keep that momentum,” said Todd Amsdell, president and CEO of the self storage company, which has acquired roughly 40 self storage properties, and, by virtue of the deals, their predecessor businesses.

Increased competition, driven by the availability of information about properties and businesses for sale and by more investors interested in self storage, is another reason for the hire, Mr. Amsdell said.

“It's not just about buying something,” he said. “It's about buying something correctly and integrating it. Anybody can go out and buy things. The real trick in all this — the magic — is buying things correctly and making sure that they fit correctly.”

Money begins to talk

Though she isn't seeing a trend of companies hiring internal M&A executives, Lauren Rich Fine wouldn't be surprised if more dedicate resources to M&A should 2014 prove to be similar to 2013 in terms of a “steady low growth economy.” She's an executive search consultant with Howard & O'Brien Inc., which conducted the search for A. Schulman's new senior director of corporate business development.

“Most larger companies in Cleveland already have dedicated corporate and business development and strategy professionals,” she said. “I think the next size down — the A. Schulmans and others — could be on the cusp of dedicating resources. To have somebody who's very disciplined who's seen a lot of activity is of enormous value.”

The way professional dealmakers see it, the more companies that hire internal and external expertise, the more deals they'll actually close. (They hope.)

M&A practitioners also see companies' investment in their M&A strategies as a sign of optimism.

“To me, it's a signal that ... maybe the hesitancy is dissipating,” said Michele Connell, an M&A partner at the Squire Sanders law firm. “From the outside looking in, there's cash on the books, the recession appears to be over. I think it's just taken the companies longer to be certain that this was over.”

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